Win the Battle for Market Share: Launching Risk-Free NPDs

Many new products are introduced every year, but only 20% of them succeed. Every brand knows that planning and successfully launching New Product Developments (NPDs) is a challenge – and experts Stijn Smet (Managing Director, AfCE), Angeliki Maragkou (Global Strategic Insights & Analytics Director, Head of CoE, Bayer), Marija Đorđević (Product Director, EyeSee), Mirna Đurić (Head of Insights, EyeSee) and Milica Kovač (Product Manager, EyeSee), deep-dived into tackling challenges, minimising the risk in the innovation process, and why testing in the pre-launch stage improves the chances of success once the product hits the shelves.

Here is what experts with first-hand NPD experience have to say:

BRING TO LIFE CONSUMER NEEDS

From the perspective of Bayer’s innovation expert, Angeliki Maragkou, the challenge is to distil the true and unmet consumer needs. She is convinced it is important to constantly thrive for cross-functional collaboration throughout the process and bring to life the unmet needs of the consumer’s journey–think about the experience early on in the process and understand the job that needs to be done.

At Bayer, Angeliki explained, in the late stages of innovation, combining methods with multiple approaches minimises the risk – and every element of the innovation is thought out separately and then together. The approach of testing with a mix of methods enables the simulation of different scenarios to better understand the whole cycle of development, especially in the pre-launch stages.

MAKE IT OR BREAK IT INNOVATION

Even with vast experience as an innovation consultant, Managing Director at AfCE, Stijn Smet, agrees that innovation is by default a risky business – some ideas will always end up in a dead-end street. But, for him, the real challenge is that many organisations either move forward with ideas against all the evidence due to the lack of alternatives, or too many potentially good ideas don’t end up being pursued at all.

He then focused on how successful companies do it right – they know how to experiment more than others and do so in a lean and cost-effective way. Organisations need to consider how to deal with more simultaneous ideas and come up with internally scalable innovation programmes that will enable intrapreneurs to derisk their idea slightly along the journey.

WITH NPD, GO BIG OR GO HOME

When it comes to challenges in developing and testing NDPs, the Head of Insights at EyeSee, Mirna Đurić, noticed that one of the most challenging things for brands is trying to make a significant impact with incremental change.

She noted that many companies want to launch the next big product just by playing it safe – developing mostly new line extensions, spreading to new geographies with existing SKUs, or targeting specific SKUs from competitors with similar products. Additionally, she believes that innovations have not changed enough, especially in the domain of sustainability – whether it implies innovation in packaging, ingredients, or waste management.

MAXIMISE THE LEAP TO MINIMISE THE RISK

Drawing from years of research, Product Director at EyeSee, Marija Đorđević, reflected on how researchers traditionally rely on large sets of data when testing NPDs – collected from in-home usage tests combined with surveys and household panels. But, as she further explained, this model has several drawbacks – it is a very costly and lengthy process, sometimes not user-friendly for the end customers.

From her perspective, researchers can take a few steps to effectively test NPDs. First, start the process with a highly realistic online representation of brick-and-mortar environments to provide an immersive shopping experience and yield better predictions of real-life consumer decisions. Then, ensure to analyse the data with statistical rigour to understand the performance beyond SKU levels – such as category, brand portfolio, switching power, and cannibalisation.

IT’S NOT A QUESTION OF IF BUT HOW TO TEST

With previous experience in insights, the Product Manager at EyeSee, Milica Kovač, believes that in-context testing before the launch significantly increases the chances of success. In her opinion, the logic of pre-launch testing is spreading far beyond the boundaries of FMCG – and the new normal even in IT product management is to pre-screen and test before launch.

She argued that the real challenge is choosing an efficient and fast methodology to get the right answer and not the wrong assessment – the NPD test should be an assessment of both market potential and risk.

KEY RECOMMENDATIONS

  • Know that the NPD testing process is not linear – map out all the unmet consumer needs and revisit them frequently
  • Enable your workforce to accelerate innovation development – master lean experimenting for successful NPDs
  • Dare to innovate – make bigger leaps to become a true category leader
  • Have a tech-enabled approach to NPDs – use highly realistic virtual testing environments for the most predictive insights
  • Make sure to wisely choose the research partner – opt for solutions that are validated against real-life sales data

 

This article was first published in the Q1 2022 edition of Asia Research Media